IED releases UT System economic impact study

(March 11, 2005)--The UTSA Institute for Economic Development (IED) released March 9 a study on the economic
impact of the University of Texas System on the Texas economy. The study analyzed the short-term economic
impact of UT System institutions on their host regions by assessing FY2004 operational expenditures, capital
purchases and construction, faculty/staff expenditures and student expenditures. Findings included a total
economic impact on the Texas economy of $12.8 billion and 215,700 jobs in FY2004.

The study shows that UTSA, which enrolled more than 26,000 students in fall 2004, has an impact on the San
Antonio area economy of approximately $600 million each year, while the university contributes more than $1.25
billion to the economy of Texas.

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"This study demonstrates that even by the most conservative standards, the UT System has a tremendous impact
on the Texas economy. But I think we all realize that it is difficult to put a firm dollar figure to the
System's contribution to Texas and its economy," said UT System Chancellor Mark G. Yudof. "The true wealth of
Texas lies in education and research -- in the minds that we nurture and the advances they create for all of
us. They are infinitely renewable resources that we are proud to help develop."

The institutions of the UT System have a huge employment impact on Texas. On average, for every on-campus
job that exists, an additional 1.5 jobs are added because of institutional related spending, the study
says. The combined employment impact of all 15 institutions on their host regions was 215,500 jobs.

The future earnings of graduates from the UT System institutions also have a profound effect on the state's
economy. For every $1 dollar the state invests in UT System higher education, that dollar serves as a catalyst
for, and ultimately results in, an additional $24 dollars of gross work-life incremental earnings that go into
the Texas economy, according to the study. Graduates can look forward to increased incremental earnings from
a college degree: a bachelor's degree recipient would typically add over $1 million beyond the baseline average
for a high school degree.

"The UT System's economic impact exceeds $12.8 billion annually along with 215,700 jobs in Texas, and
further contributes to our prosperity with 35,000 graduates every year," said Robert McKinley, lead
investigator of the study. "With each successive class of new workforce entrants fulfilling their higher
potential, and leading our knowledge-based industry growth, Texas can compete and win in the global
marketplace."

Construction on UT campuses is another major factor impacting the state's economy. Capital expenditures in
fiscal year 2004 contributed an estimated $2 billion in local regions. During the next six years, UT
institutions are projected to spend an estimated $5 billion on construction projects, and with additional
expenditures resulting from those purchased, the combined impact of that construction will be $7.7 billion.

A group of expert advisers worked with the study's research team in developing the report. Those advisers
included Texas economist Ray Perryman and state demographer Steve Murdock, who is the Lutcher Brown
Professor of Demography in the UTSA College of Business and director of the UTSA Institute for Demographic
and Socioeconomic Research and the Texas State Data Center.

"The researchers have utilized a widely accepted methodology for assessing the impacts of a
university, although one that does not fully capture all economic interactions. I consider this a significant
but conservative assessment of the overall annual economic impacts of the University of Texas System," said
Perryman. "When coupled with the long-term effects of improving the education of Texans, these results show
that the University of Texas System has an important and significant impact on the economic development of the
state of Texas."

The UT System has an annual operating budget of $8.5 billion (FY 2005). Student enrollment exceeded 182,000
in the 2004 academic year. The UT System confers one-third of the state's undergraduate degrees and educates
three-fourths of the state's health care professionals annually. With more than 76,000 employees, the UT System
is one of the largest employers in Texas.